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Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
Ticker: CON
ADR-Ticker: CTTAY
http://www.continental-ir.com
Michael Sämann, IR Manager
Sabine Reese, IR Manager
Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
Technologies in the Automotive Group
4 26
Agenda
2EDMR – Equity and Debt Markets Relations
Continental at a Glance1 3
Sustainability at Continental
2 9
Environmental Responsibility
3 16Technologies in the Rubber Group
5 30
Outlook 416
17
22
Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
3EDMR – Equity and Debt Markets Relations
SAFEEFFICIENT INTELLIGENT
1. Continental at a GlanceIntro
Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
1. Continental at a GlanceCorporate Strategy
4EDMR – Equity and Debt Markets Relations
Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
1. Continental at a GlanceThe Most Digitalized Portfolio in The Supplier Sector1
5EDMR – Equity and Debt Markets Relations
Source: Company filings and Continental estimates. 1 Suppliers >€3 bn sales.
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Competitor 10
Competitor 9
Competitor 8
Competitor 7
Competitor 6
Competitor 5
Competitor 4
Competitor 3
Competitor 2
Competitor 1
Continental Automotive
Today: Electronics/Sensors/SW products as % of sales
Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
1. Continental at a GlanceThe Same Values Worldwide for a Shared Corporate Culture
6EDMR – Equity and Debt Markets Relations
Freedom
To ActTrust
Passion
To Win
For
One Another
Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
1. Continental at a GlanceTechnological Balance
7EDMR – Equity and Debt Markets Relations
Compound annual growth rate
Introduction Growth Maturity Saturation
≥ 5 - 10% 0 - 10% ≤ 0% Time
Technology life cycle Technology portfolio share of sales in %
Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
Other Sales
Sales 2017
€44.0 bn
40%
thereof
Products to Reduce
CO2 Emissions
Green Tires
~28%
Powertrain Components
~43%
Lightweight Components
~29%
› Green tires
optimized on rolling resistance
(all tires labelled C and better)
› Lightweight components
Light weight brakes, road database
(green maps), intelligent
transportation systems
8EDMR – Equity and Debt Markets Relations
1. Continental at a GlanceSales of Products to Reduce CO2 Emissions
Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
9EDMR – Equity and Debt Markets Relations
* Federal Statistics Office, Germany (Destatis);
ABS - Anti-lock Brake System, ESC - Electronic Stability Control , BA - Brake Assist, ACC - Adaptive Cruise Control, LDW - Lane Departure Warning, AEB – Autonomous Emergency Braking.
2. Technologies in the Automotive GroupHistory and Roadmap for Accident-Free Driving
0
5.000
10.000
15.000
20.000
25.000
1953 1963 1973 1983 1993 2003 2013
3,220
1973: Safety Seat Belt
1978: ABS
1982: Airbag
1985: Front Passenger Airbag
1995/96: ESC, BA, Euro NCAP
1998: ACC 2001: LDW
2006: AEB
Traffic Fatalities in Germany 1953 - 2018
2018
Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
10EDMR – Equity and Debt Markets Relations
2. Technologies in the Automotive GroupOutlook 2025 - Approaching Automated Driving: Three-Layer Model
Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
11EDMR – Equity and Debt Markets Relations
L5L4L3L0-L2 Total Market
PC&LV production (mn units)
2. Technologies in the Automotive GroupAutomated Driving – Estimated Market Development
Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
12EDMR – Equity and Debt Markets Relations
Surround View
Ultrasonic3
Camera
3D Flash Lidar
Long Range
RadarLevel
4/5
Level
3
Level
2
441
401
~402
25-
292
18-222
BMW
GM
Continental
Short Range
Radar
1 Source: https://www.bmwgroup.com/content/dam/bmw-group-websites/bmwgroup_com/ir/technologie_workshops/
Technology_Workshops_Autonomous_Driving.pdf
https://www.gm.com/content/dam/gm/events/docs/5265893-685163-Chartset-11-30-2017.
2 Continental estimates, depending on customers and future regulatory requirements.
3 Ultrasonic not in Continental portfolio.
2. Technologies in the Automotive GroupAutomated Driving – ADAS Sensors per Car
Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
13EDMR – Equity and Debt Markets Relations
With our holistic, intuitive and
ergonomic human-machine interface,
we capture commands and prioritize
and present information.
Driver and Passengers
We add new functions by providing a holistic connection to the outside world as well as value-added mobility services.
Devices Infrastructure Other Vehicles
We manage and optimize the information flow
by systems integration of components.
Vehicle
2. Technologies in the Automotive GroupHolistic Connectivity – Information Management
Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
14EDMR – Equity and Debt Markets Relations
Most complete product portfolioA necessary and unique selling proposition for us as systems integrator.
System Integration
Integrate of components and functions into a
superior system.
All at lower cost
Holistic Connectivity
Connect the driver by wire or wirelessly and
provide value-added mobility services.
We connect
Holistic Human-Machine Interface
Provide the expertise for superior comfort and
convenience, ergonomics, and intuitive
ease-of-use.
We inform you well
2. Technologies in the Automotive GroupHolistic Connectivity – Product Highlights for Intelligent Mobility
Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
15EDMR – Equity and Debt Markets Relations
>30 million1
connected vehicles by
2017: >50%of produced vehicles are
connected
2020: >250 millionof the vehicles on the road will be
connected1 Since 1996.
2. Technologies in the Automotive GroupHolistic Connectivity Car
Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
16EDMR – Equity and Debt Markets Relations
We will become a full system supplier!
Driving Intelligence› Situation analysis
› Decision-making
› Low-level vehicle control
› ADCU (mid-term)
Seat Material Tailored seat surfaces
› Resilient
› Easy to clean
› Comfortable
LocalizationRobust localization in urban areas
› Radar
› Wireless infrastructure beacons
Radar SensingShort range sensor
› Object detection
› Barrier detection
› 4 sensors for 360° view
Camera Sensing› Object detection
› Barrier detection
› Front sensor cover drive path
Drive Module› One axle drive from
Continental (2018)
Tires› ContiEcoContact™ 5
Lidar SensingSolid state flash lidar (mid-term)
› Object detection
› Barrier detection
› 4 sensors for 360° view
Continental Urban Mobility Experience
2. Technologies in the Automotive GroupSelf Driving Car Project CUbE
Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
17EDMR – Equity and Debt Markets Relations
4%
36%
46%
12%2%
Civil Engineering Recycling Energy Reuse/Export Landfill
End-of-life tires in the European Union1
A total of approximately 3.25 million tons of used tires accumulate
in the EU per year.
Recycling versus raw material2
Energy needed to produce 1kg of tire compound
From Raw Material
From Recycled Material
82
8.7
MJ per kg tire compound
1 Source: ETRMA, June 29, 2016. 2 Source: Continental Reifen Deutschland.
3. Technologies in the Rubber GroupTires – Recycling and Recovery
Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
18EDMR – Equity and Debt Markets Relations
3. Technologies in the Rubber GroupTires – ContiLifeCycle
Breathing life into tires a second and even a third time
is the basic idea behind the ContiLifeCycle approach.
Using a novel and proprietary process, Continental has succeeded in
recycling rubber from used tires in such a way that the raw material will
be directly returned into the production cycle for new or retreaded tires.
At ContiLifeCycle (CLC) plants, we reprocess worn-out truck tires in a
retreading process that conserves resources. The rubber powder that
is produced during retreading is further processed into recyclate, which
is used in the production of new and retreaded tires.
The retreaded tires offer the same performance characteristics and
rolling resistance as new tires.
80%
80%50%less energy
less waste2,400
less tons
8,000 tons
Recycling
of used rubber in
the recycling plant
4,000 tons
saves
of CO2 per year
2,400
less water
of natural
rubber
Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
This natural rubber used from dandelion roots has at least the same quality and
performance characteristics as conventional rubber from rubber trees.
The plants can be cultivated in Northern and Western Europe on land that is
unsuitable for food crops. “Plantations beside the tire plants” in Central Europe
makes both economic and ecological sense.
The new dandelion rubber Taraxagum should enter production within the next
five to ten years and then flow step-by-step into our rubber products.
Benefits:
› Reduction in dependency on harvest situation in subtropical regions
› Lower requirements on the fertility of the soil
› Lower environmental impact due to reduced logistic requirements
› Optimal material properties enable first-class products in terms of technology
19EDMR – Equity and Debt Markets Relations
› Innovation and the Green Award both at
the international trade fair Automechanika
2016
› Joseph von Fraunhofer Prize 2015
› GreenTecAward 2014
3. Technologies in the Rubber GroupTires – Rubber from Dandelions
Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
20EDMR – Equity and Debt Markets Relations
Technological expertise for customer-specific solutions
Health-friendly
interiors
Climate-friendly
printing blankets
Mounts for
wind power
Flexible insulation
for energy saving
Hoses for energy
storage in the sea
Printing technology for
printed electronics/solar cells
Rubber tracks
for more efficiency
Components for engine downsizing
and emissions reducing
3. Technologies in the Rubber GroupSustainable Product-Solutions for a Variety of Industries by ContiTech (1/2)
Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
21EDMR – Equity and Debt Markets Relations
3. Technologies in the Rubber GroupSustainable Product-Solutions for a Variety of Industries by ContiTech (2/2)
Cargo E-bike – carbon belts designed for
high loads.
Air bubble curtain with hose system reduces
noise when building wind farms.Hyperloop – belt from Continental drives the
HyperPodX.
Sicon conveyor belts from Continental are a
gentle transport solution for fish feed.
Oil barriers – contain of oil spills even in
rough seas.
Floating solar film – protects water against
evaporation and generats electricity from solar
energy.
Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
22
Sustainable management at all stages of the value chain and throughout
the entire life cycles of our products is now an essential part of our philosophy.
United Nations’ 17 sustainable
development goals (SDGs)
Start of
Continental
environmental
strategy update
Roll out and implementation of strategy program 2020› Involvement of Suppliers
› Demand and encouragement of comprehensive environmental management
› The supply chain has the same importance as strategic environmental projects for reducing environmental impacts through our own action.
› Implementation of major Roadmap 2020 goals.
› Definition of major ESG criteria (water, climate change, saving of resources) in line with four of the SDGs1.
Implementation of the objectives on the SDGs1 goalsDefinition
of sub-goals
EDMR – Equity and Debt Markets Relations
1 SDG: Sustainable Development Goals.
4. Environmental ResponsibilityEnvironmental Strategy 2020
Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
23EDMR – Equity and Debt Markets Relations
Our activities are geared toward continually optimizing the use of resources in
relation to business volume. We manufacture products that make an active
contribution toward protecting the environment and conserving resources throughout
their entire duration of use as well as when they are ultimately recycled.
By 2020, we want to reduce our CO2 emissions, energy and water consumption, and
waste generation by 20% – in relation to adjusted sales1, using 2013 as a basis. We
also intend to improve our waste recycling and reuse rate by two percentage points a
year. With regards to the locations with which we started the strategy in 2013, we are
on target to achieve our goals. With regard to energy consumption, CO2 emissions
and water consumption, we have already achieved a reduction of roughly 15% to
18%.
Continental established an environmental management
system throughout the corporation more than 30 years ago.
233Production
Locations
worldwide
193Thereof
ISO 14001
certified
1 Before changes in the scope of consolidation (Sustainability Report 2017, page 1).
4. Environmental ResponsibilityStatus of Environmental Certification at Continental
Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
24EDMR – Equity and Debt Markets Relations
1 Source: ISO (International Organization of Standardization) www.iso.org/iso/home.html. Source: www.continental-sustainability.com
‘The ISO 9000 family addresses various aspects of quality
management and contains some of ISO’s best known
standards.’1
‘The standards provide guidance and tools for companies
and organizations who want to ensure that their products
and services consistently meet customer’s requirements,
and that quality is consistently improved.’1
is the totality of features and characteristics of a product or service
that bear on its ability to satisfy a given need.Quality
ISO/TS 16949
ISO 9001 or
ISO/TS 16949
Automotive Group:
Production sites 100%Rubber Group Tires:
Production plants 100%Rubber Group ContiTech:
Production sites 100%
ISO/TS 169491
Specifies requirements using ISO 9001 for service and replacement
production in the automobile industry.
4. Environmental ResponsibilityStatus of Quality Certification at Continental
Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
The energy intensity quotient used at Continental is the sales adjusted by changes in the scope of consolidation (2017 €43.3 billion). All Scope 1 and 2 energies are included in the calculation of energy intensity.
The total energy includes the following types: fossil fuels, purchased electricity, self generated electricity, purchased steam and district heat.
Energy consumption
777 819 784 669
2.935
3.2993.498
2015 2016 2017 target 2020
Specific energy consumption (GJ/€ mn in adjusted sales) for all plants (including acquisitions and new constructions)
Total energy consumption
39%
1%11%0%
49%
Non-renewable fossil energy
Self-generated electricity from fossil fuels
Purchased steam
District heating
Purchased electricity
2017
Specific energy consumption by source (%)
25EDMR – Equity and Debt Markets Relations
4. Environmental ResponsibilityCorporate Environmental Key Performance Indicators (1/4)
Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
738 754 730613
715 794 820
2.0732.252
2.347
2015 2016 2017 target 2020
Specific CO2 emissions (100kg/ € mn adjusted sales)
Scope 1: direct CO2 emissions (1,000 metric tons)
Scope 2: indirect CO2 emissions (1,000 metric tons)
1 Reviewed with limited assurance by an independent auditor.
CO2 emissions1
26%
74%
Direct CO2 emissions
Indirect CO2 emissions
2017
Scope 1 and 2 (%) Scope 3 (%)
11%
5%
77%
0%1% 6%
Self commissioned incoming logistics
Self commissioned outgoing logistics
Purchased goods and services
Waste produced through operational processes
Business travel
Fuels and energy related activities not included inScope 1 and 2
2017
26EDMR – Equity and Debt Markets Relations
4. Environmental ResponsibilityCorporate Environmental Key Performance Indicators (2/4)
Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
442 480 456 394
1.671
1.932 1.978
2015 2016 2017 target 2020
Specific water consumption (m3/€ mn in adjusted sales) for all plants (including acquisitions and new constructions)
Total water consumption
1 Reviewed with limited assurance by an independent auditor.
Water consumption1
15%
38%
46%
1%
Surface water
Ground water
Potable water from public water supplies
Industrial water from public water supplies
2017
Specific water consumption by source (%)
27EDMR – Equity and Debt Markets Relations
4. Environmental ResponsibilityCorporate Environmental Key Performance Indicators (3/4)
Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
82 88 8868
310
353379
83 79 81 90
2015 2016 2017 target 2020
Specific waste generation (100kg/€ mn in adjusted sales) for all plants (including acquisitions and new constructions)
Waste generation (1,000 metric tons)
Waste recycling (%)
1 Reviewed with limited assurance by an independent auditor.
Waste production1 Waste recycling rate (%)
81%
19%
Recycling rate
2017
28EDMR – Equity and Debt Markets Relations
4. Environmental ResponsibilityCorporate Environmental Key Performance Indicators (4/4)
Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
29EDMR – Equity and Debt Markets Relations
90%less energy
90%less raw material
less CO2 emissions50-90%
Remanufacturing is a standardized industrial process and an integrated part of our service strategy. Rather than
manufacturing products from scratch, Continental remanufactures existing products by repairing and replacing
components with new original Continental parts. For the circular economy we save energy, water, material and
costs to make renewed products for a sustainable future.
up to
used
produced
up to
consumed
4. Environmental ResponsibilityAutomotive - Remanufacturing
Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
30EDMR – Equity and Debt Markets Relations
1. Assessments to determine status of the supplier.
2. Measures (joint projects, training sessions, and workshops for example)
are initiated to achieve our goals in supplier development as necessary.
We monitor the environmentally friendly production of our suppliers worldwide as
part of internal supplier audits. Relevant issues in the scope of these audits include
compliance, organization and the provision of resources for EH&S.
Starting in 2017, we will systematically evaluate our suppliers based on sustainability
criteria with the help of an independent service provider. Our goal in doing so is to
better fulfill our responsibilities and ensure that we are able to comply with our
requirements within the worldwide supply chain.
Goal by 20201: 100% of strategic suppliers meet ISO 14001 requirements
ISO 14001certified Suppliers
Automotive Group
Rubber Group
85%
73%
1 Environmental Strategy 2020. Source: Sustainability Report 2017, page 18.
5. Sustainability at ContinentalSupply Chain – Certification of Suppliers
Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
31EDMR – Equity and Debt Markets Relations
› Rubber Group introduced 3rd party supply chain CSR assessment tool based on
UN Global Compact, ISO26000 and Global Reporting Initiative
› >80% of annual spent already covered
› Upon findings, buyers will request and monitor improvement actions
5. Sustainability at ContinentalSupply Chain – Evaluation of Raw Material Suppliers
Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
32EDMR – Equity and Debt Markets Relations
Improvement of the environmental performance of our suppliers in Mexico.
The aim of the initiative was to train and help the
suppliers to establish and enhance their own
environmental and energy management systems.
Over a two-year period ten selected suppliers
received training in the areas of environmental
and energy management.
This project will be continued and opened up to
additional suppliers.
923 megawatt hoursenergy
210 tonswaste
4,600 m3
water
755 tonsCO2 emissions
Savings during the project
For more information please go to the Sustainability Report 2017, page 21.
5. Sustainability at ContinentalSupply Chain – Project Environmental Performance
Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
33EDMR – Equity and Debt Markets Relations
Continental acknowledges challenges in the Natural Rubber
supply chain related to environmental, social and human
rights impacts.
With the SNR Procurement Policy Continental commits to
work towards SNR in a multi-stakeholder approach and set
requirements for our supply chain.
Continental contributes to the GPSNR (Global Platform for
SNR) launched Oct, 25th 2018 by WBSCD1 Tire Industry
Project.
1 World Business Council for Sustainable Development.
5. Sustainability at ContinentalSupply Chain – Sustainable Natural Rubber (SNR)
Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
34EDMR – Equity and Debt Markets Relations
Partnership between Continental and Deutsche Gesellschaft für Internationale
Zusammenarbeit (GIZ).
Goal: Development of a training for farmers in sustainable production of natural rubber
and to track the rubber from smallholders to production at Continental.
Pilot project: 400 farmers will be trained to grow high-quality rubber in accordance with
clearly defined sustainability criteria.
Improved rubber quality, higher yields and supply chain optimization will generate higher
incomes for rubber tree cultivators.
Improvement livelihoods of rubber tree farmers in Indonesia.
5. Sustainability at ContinentalSupply Chain – Project Sustainable Natural Rubber
Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
35EDMR – Equity and Debt Markets Relations
1 Environment, Safety and Health.
Principles of our Corporate Social Responsibility
Environmental
Responsibility
Social
Responsibility
ESH1 Policy –
implements worldwide the responsibility
for protecting the environment
Code of Conduct – ethical standards and
requirements concerning employee behavior
Business Partner Code of Conduct –important standards that are consistent with
our values and which we expect each
Business Partner to adhere to
Corporate Governance Policy –
to further a responsible management of
the company focused on value creation
Risk Report – overview of our
Risk Management
OUR BASICS Our corporate guidelines
Corporate
Governance
5. Sustainability at ContinentalPolicies and Guidelines
Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
36EDMR – Equity and Debt Markets Relations
Exte
rnal re
lev
an
ce
Relevance for Continental
medium highlow
medium
high
low
Logistics
Water
Biodiversity
Lobbying
Climate protection and air
Wastewater and waste materials
Regional commitment
Human rights
Occupational health and safety
Supply chain
Raw materialsData protection
Diversity and equal opportunities
Training
Attractiveness
as an employer
Compliance
Sustainable products
Road safety/
vehicle safety
For more information please refer to Sustainability Report 2017, page 10ff.
5. Sustainability at ContinentalMateriality Matrix:
Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
In 2015, we developed a consolidated sustainability program and set ourselves goals for 2020 which were derived from the materiality matrix in order to achieve measurable improvement in our four fields of action. Some of these extend until 2025. These are the fields of activity and main goals from our Roadmap 2020:
37EDMR – Equity and Debt Markets Relations
› Compliance and
Supply Chain
› Lobbying
› Diversity and
equal opportunities
› Occupational safety and
health
› Attractiveness as an employer
› Job training and
continuing education
› Road and vehicle safety
› Raw materials
› Sustainable products
Corporate governance
and corporate cultureEnvironment Employees and society Products
› Climate protection and air
› Waste
› Water
For more information please refer to Sustainability Report 2017, page 12ff.
5. Sustainability at ContinentalMateriality Matrix – Roadmap 2020
Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
Disclaimer
› This presentation has been prepared by Continental Aktiengesellschaft solely in connection with the 14th HSBC ESG Conference on February 5-6, 2019, in Frankfurt. It has not been
independently verified. It does not constitute an offer, invitation or recommendation to purchase or subscribe for any shares or other securities issued by Continental AG or any
subsidiary and neither shall any part of it form the basis of, or be relied upon in connection with, any contract or commitment concerning the purchase or sale of such shares or other
securities whatsoever.
› Neither Continental Aktiengesellschaft nor any of its affiliates, advisors or representatives shall have any liability whatsoever (in negligence or otherwise) for any loss that may arise
from any use of this presentation or its contents or otherwise arising in connection with this presentation.
› This presentation includes assumptions, estimates, forecasts and other forward-looking statements, including statements about our beliefs and expectations regarding future
developments as well as their effect on the results of Continental. These statements are based on plans, estimates and projections as they are currently available to the
management of Continental. Therefore, these statements speak only as of the date they are made, and we undertake no obligation to update publicly any of them in light of new
information or future events. Furthermore, although the management is of the opinion that these statements, and their underlying beliefs and expectations, are realistic as of the date
they are made, no guarantee can be given that the expected developments and effects will actually occur. Many factors may cause the actual development to be materially different
from the expectations expressed here. Such factors include, for example and without limitation, changes in general economic and business conditions, fluctuations in currency
exchange rates or interest rates, the introduction of competing products, the lack of acceptance for new products or services and changes in business strategy.
› All statements with regard to markets or market position(s) of Continental or any of its competitors are estimates of Continental based on data available to Continental. Such data are
neither comprehensive nor independently verified. Consequently, the data used are not adequate for and the statements based on such data are not meant to be an accurate or
proper definition of regional and/or product markets or market shares of Continental and any of the participants in any market.
› Unless otherwise stated, all amounts are shown in millions of euro. Please note that differences may arise as a result of the use of rounded amounts and percentages.
› Note: Due to the application of the modified retrospective approach during first time adoption of IFRS 9, Financial Instruments, and IFRS 15, Revenues from Contracts with
Customers, as at January 1, 2018, all the figures from comparative periods are shown unadjusted.
Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
ContactEquity and Debt Markets Relations
Vahrenwalder Str. 9
30165 Hanover
Germany
e-mail: [email protected]
Fax: +49 511 938 1080
www.continental-ir.com
Bernard Wang
Head of IR
Phone: +49 511 938 1068
e-mail:
Jana Cross
Assistant to the Head of IR
Roadshow and Conference Organization
Phone: +49 511 938 1163
e-mail: [email protected]
Michael Sämann
Analysts, Institutional Investors and
Sustainability Investors
Phone: +49 511 938 1307
e-mail: [email protected]
Marvin Kalberlah
Analysts, Institutional Investors and
Social Media
Phone: +49 511 938 14034
e-mail: [email protected]
Christopher Macke
Analysts and Institutional Investors
Phone: +49 511 938 1062
e-mail: [email protected]
Klaus Paesler
Analysts, Institutional Investors, ADR
and Private Investors
Phone: +49 511 938 1316
e-mail: [email protected]
Sabine Reese
Sustainability, ASM, CMD
Organization, IR Website, Capital
Market Disclosure Requirements
Phone: +49 511 938 1027
e-mail: [email protected]
Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
24
,36
2
23
,02
2
22
,49
8
25
,26
3
24
,30
9
24
,10
1
21
,87
7
24
,37
5
23
,50
0
23
,50
0
22
,60
0
25
,00
0
6%0% 2% 1% 0% 5%
-3% -4% -3% -2%
3% 3%
Q1/1
7
Q2/1
7
Q3/1
7
Q4/1
7
Q1/1
8
Q2/1
8
Q3/1
8E
Q4/1
8E
Q1/1
9E
Q2/1
9E
Q3 1
9E
Q4 1
9E
WW production chg YOY
6. Outlook 2018PC & LT Production by Quarter1
41
Worldwide (mn units)
2017: 95.1 2018E: ~94.6 2019E: ~95
1 Source: IHS until 2017 and own estimates, Europe excluding Kazakhstan and Uzbekistan.
EDMR – Equity and Debt Markets Relations
Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
6. Outlook 2018Market Outlook
42
1 Source: IHS until 2017 and own estimates, Europe excluding Kazakhstan and Uzbekistan.
Commercial Vehicle2 Production (k units)
Commercial Vehicle Replacement3 Tire Market (mn units)
PC & LT1 Production (mn units)
PC & LT1 Replacement Tire Market (mn units)
Worldwide production
to stay flat
Worldwide production
to increase by 3%
Worldwide replace-
ment tire market to
increase by 2%
Worldwide replace-
ment market to
increase by 2%
IHS and
own estimates
LMC and
own estimates
IHS and
own estimates
LMC and
own estimates
2018E 2019E Chg.
Europe 21.8 21.8 0%
North America 16.9 16.9 0%
South America 3.5 3.7 +7%
Asia 51.3 51.0 -0%
2018E 2019E Chg.
Europe 687 714 +4%
North America 590 620 +5%
South America 143 157 +10%
Asia 1,969 2,004 +2%
2018E 2019E Chg.
Europe 358 364 +2%
North America 290 290 +2%
South America 68 69 +2%
Asia 453 467 +3%
2018E 2019E Chg.
Europe 25.6 26.0 +2%
North America 25.7 26.4 +3%
South America 15.7 15.7 +0%
Asia 86.5 87.9 +2%
1 Passenger cars and light trucks <6t.2 Medium and heavy vehicles >6t.3 Radial and bias.
EDMR – Equity and Debt Markets Relations
Sustainability Presentation
14th HSBC ESG Conference
Frankfurt – February 5-6, 2019
6. Outlook 2018Continental Corporation
43
2018E 2019E
Consolidated sales
adj. EBIT1 margin
~€44.4 bn
~9.2%
To increase to about €45 bn – €47 bn at constant FX
about 8% – 9% adj. EBIT1 margin
Automotive Group
adj. EBIT1
~€26.8 bn
~€1.85 bnMarch 7, 2019
Rubber Group
adj. EBIT1
~€17.6 bn
~€2.3 bnMarch 7, 2019
Raw materials cost impact ~€100 mn
for the Rubber Group
~€50 mn
for the Rubber Group based on latest assumptions
Special effects ~€90 mn About -€200 mn including carve out effects
Financial result
Tax rate
~€180 mn at constant FX2
~23%
About -€220 mn at constant FX2 including IFRS 16
~27% including carve out effects
Capex
PPA amortization
~€3.1 bn
~€180 mn
~8% of sales including IFRS 16
~€200 mn
Free cash flow before acquisitions ~€1.8 bn excluding net effect of
US pension funding
€1.4 bn to €1.6 bn before carve out effects
1 Before amortization of intangibles from PPA, consolidation and special effects.
2 Before effects of currency translation and effects from changes in the fair value of derivative instruments, and other valuation effects.
EDMR – Equity and Debt Markets Relations